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In my 40+ years of helping people start new businesses, I have identified several potential problems that entrepreneurs often overlook in their eagerness to get their business up and running. Businesses succeed because of a number of variables, not all of which can be foreseen. But many of the problems could have been easily avoided by consultation with a lawyer who understands the issues confronting a new venture.

The Entity That’s Best for You:

There are many  ways to organize your business and each alternative has good and bad points. The most common choice is between a corporation or a limited liability company. A corporation limits your liability and increases your potential for raising capital. But a corporation also comes with strict reporting requirements and unfavorable taxation issues. A limited liability company, as its names suggests, also limits your personal liability and it comes with tax advantages, but there are restrictions on selling an interest in the LLC and the laws governing LLCs are not uniform across the country.

There are other choices and there are many factors that go into deciding which type of organization is best for your venture. Our website has some information to help in comparing corporations and limited liability companies. Continue reading

   In this electronic world, signatures are still required to create a binding and enforceable contract.  Many negotiations take place thru email or the web.  Many contracts are negotiated without the parties ever having met face to face.   Laws have adapted to the changing world, and these changes make it possible to create binding contracts without a pen touching a piece of paper.

   The UNCITRAL Model Law on Electronic Commerce was adopted by the United Nations in 1996.  This model law helped form electronic signature laws around the world, including in the U.S.   The U.S. Code was changed in 1999 and e-signatures are broadly defined in the Uniform Electronic Transactions Act (UETA) and includes “an electronic sound, symbol, or process, attached to or logically associated with a record and executed or adopted by a person with the intent to sign the record.”   This definition and many other core concepts of UETA are echoed in the U.S. E-Sign Act of 2000.   Every state but three have enacted the UETA.   Illinois has not enacted UETA but has adopted its own e-signature laws. 

   For more information on e-signatures and the related laws, go to my firm’s web page that goes in to more details: “Is an E-Signauture Legally Enforceable?”

The Illinois Supreme Court overrules the Amazon Tax Law

Illinois lawmakers’ attempts to level the playing field for Illinois small businesses took a major hit by our own Illinois Supreme Court last week.

We all know that we don’t pay Illinois sales taxes on purchases made thru the web.  Those books we buy thru Amazon.com don’t have the Illinois sales/use tax added.  But, the same book purchased at a “bricks and mortar” business in Illinois is subject to the Illinois sales tax.    What consumers don’t know is that if the retailers don’t collect the pay the sales tax, the buyer must report the sale and pay the “use tax” on the transaction.   (Which is why it is called the Sales/Use tax!)

So, the Illinois legislature adopted a law requested by Illinois business owners to level the playing field by requiring the sellers on the web to collect and pay the Illinois sales tax on sales made to Illinois citizens, and the Illinois legislature responded with the a taxing statute – Public Act 96-1544 effective in 2011 – called the “Main Street Fairness Act” which has been referred to as the “Amazon.com Tax Law.” Continue reading

It’s started.  The federal courts are beginning to shut down.

On October 7, the U.S. District Court for the Northern District of Illinois issued an Order which stated that all civil cases involving the U.S. as a party are suspended and nothing will be done in those cases unless there is a special need.

This Order does not affect any criminal cases.

Congress has breached its contract with the taxpayers.  Can we sue?

Client comes to me with a problem.   She hired a consultant to take care of her company’s computers and telephone systems, and agreed to pay them a monthly retainer.  She is paying for their services.  But, the company shut down and is no longer performing the services that she pays for. 

The answer is obvious – Stop making the payments.  It’s basic contract law.  You know, the law that Professor Kingsfield in “The Paper Chase” pounded into the first year law students brains.   They had a contract, they breached it by not paying, so your performance is excused.    In fact, they owe her money for services she paid for but did not receive. 

Litigation Against Modern Day Pirates

Pirates have gone from sailing to surfing.  Surfing the Internet that is.  They are no longer found sailing the open seas, but rather pillaging materials, many of which are copyrighted, off of the Internet.  Modern day pirates are able to steal copyrighted materials because they hide behind the mask of an anonymous IP address.  These anonymous pirates steal music, t.v. shows, computer software and electronic books every day.

Plaintiff’s attorneys must become familiar with the current technology and the various obstacles that arise during these types of copyright infringement cases.  For starters, Plaintiff’s attorneys need to understand the terminology used in these cases. Below is a list of common terminology used in these types of copyright infringement cases:

Small Businesses in Illinois are Offered Tax Credits for Providing Health Insurance to Employees Under the Affordable Care Act

The federal statute commonly referred to as the Affordable Care Act (“ACA”) takes effect in 2014.  One of the many goals of the ACA is to increase the number of Americans with health insurance coverage. The Act requires that large businesses provide health insurance coverage for all full time employees or face penalties and provides incentives for small businesses to provide health insurance coverage.

Who is considered a full time employee?

Illinois Bans the Use of Cell Phones in Cars –

Effective January 1, 2014, Illinois drivers will not be able to use their cell phones for calling or texting unless they use hands free devices such as Bluetooth.

Distracting driving has gotten a lot of attention recently, particularly with the increased use of texting.  DON’T TEXT AND DRIVE!   In fact the National Highway Traffic and Safety Administration (NHTSA) has been studying the problems associated with distracted driving for some time (http://www.nhtsa.gov/Research/Human+Factors/Distraction) and has noted that there are many types of ways to divert a driver’s attention such as eating, applying makeup, tuning a radio, use of cell phones, and playing music.

DOMA Implications for Illinois Small Businesses

On June 26, 2013 the SCOTUS in United States v. Windsor found Section 3 of the federal Defense of Marriage Act (DOMA) unconstitutional.  Section 3 had prohibited marriages between same-sex couples from being acknowledged by the federal government.  This meant that under DOMA same-sex couples were denied federal marriage benefits.

With the Supreme Court’s ruling in Windsor businesses are going to need to update and evaluate their current employee benefit plans.  Currently, the Windsor ruling only applies to the 12 states and the District Columbia that recognized same-sex marriage at the time of the ruling. 

A–Rod and his legal hassles:

Essentially, A–Rod was suspended for 211 games (the remainder of the 2013 season and all of the 2014 season).  The other 12 players were suspended for 50 games which were imposed under an agreement with MLB.  As part of the other 12 suspensions, they all agreed not to appeal.

A–Rod is the only one who chose to appeal.